Google and Facebook's Digital Ad Dominance is Massive... and Growing

Visual Capitalist |

The Dominance of Google and Facebook in One Chart

Over the next couple years, digital advertising is expected to pass television to become the largest ad market in existence.

One would think that this simple fact should translate to a bright future for many publishers, but the reality seems to be quite different. That’s because digital advertising is increasingly dominated by just two players, and everyone else is just begging for scraps.

The Ad Duopoly

Today, close to $0.60 of every dollar spent on digital advertising goes to Google (GOOG) and Facebook.

The crazy thing is that these are still early days, especially for Facebook (FB), which grew its digital ad revenue by 59% last year. The social media company recently smashed Wall Street’s expectations again, as it revealed that Facebook’s mobile business alone was bigger than its entire business back in 2015 Q3.

This lopsided growth is quite the juxtaposition to the media stalwarts of the world.



Iconic brands such as The New York Times have struggled to make a full transition to digital, making only $200 million per year from the online ad side of their business. That makes the Times, along with other traditional media companies like News Corp (NWSA), Time Inc (TIME), or Hearst, too “small” to even show up on our chart.

It's a Platform Kind of World

In the digital advertising landscape, it’s all about the power of platforms. The majority of our chart is loaded with companies that have created (or bought) platforms full of user-generated content that people use every day. Facebook, YouTube (owned by Google), Twitter (TWTR), Snapchat, LinkedIn (LNKD), and Yelp all make the cut on our chart, because they have gained massive scale.

In a nutshell, this is why the best technology companies have overtaken names like Exxon Mobil (XOM) or Wal-Mart (WMT) to be the largest by market capitalization in the world.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
FB Facebook Inc. 178.74 -0.26 -0.15 9,580,692 Trade
WMT Wal-Mart Stores Inc. 97.48 0.01 0.01 16,390,722 Trade
LNKD LinkedIn Corporation Class A n/a n/a n/a 0 Trade
GOOG Alphabet Inc. 1,018.38 -0.71 -0.07 953,463 Trade
XOM Exxon Mobil Corporation 80.55 0.31 0.39 8,463,831 Trade
TIME Time Inc. 16.55 0.15 0.91 2,903,928 Trade

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